Addendum regarding the legal merger between NV and Van Lanschot Kempen NV Contents

3 1. Introduction and executive summary

4 2. The Van Lanschot Kempen group and the preparations for the Merger

6 3. Envisaged legal group structure and corporate governance

8 4. Benefits of the Merger on the capital position and reporting

9 5. Impact and risk analysis Merger Addendum 3

1. INTRODUCTION AND EXECUTIVE SUMMARY

1.1 Introduction Requirement (P2R) create an opportunity to optimise the capital structure by partially replacing In its third quarter trading update in 2020 CET1 with AT1 and Tier 2 instruments. After the Van Lanschot Kempen announced that it was investigating legal merger, the minority interest deduction is no a potential legal merger (juridische fusie) of the holding longer applicable which consequently means that company Van Lanschot Kempen NV (VLK Holding) into its the capital ratios of the listed company after the 100% subsidiary Van Lanschot Kempen Wealth legal merger are the same as VLKWM’s current Management NV (VLKWM) whereby VLK Holding will be capital ratios. the disappearing entity (the Merger). After having duly b) The Merger leads to the reduction of a governance investigated the matter in close consultation with the layer (currently there are two legal entities with a various stakeholders involved, VLK Holding and VLKWM personal union of the statutory board and the formally announced the intention to effect the Merger by supervisory board of VLK Holding and VLKWM) publishing a merger proposal (fusievoorstel) and the (see chapter 3). related documentation on 15 April 2021. The Merger is c) Lastly, the internal workload associated with the subject to the approval of the general meeting of VLK financial and regulatory reporting will be reduced. Holding and this document is intended to inform the shareholders and the depositary receipts holders as to the • VLK Holding does not engage in any activities other reasons to pursue the Merger and the implications of the than holding the shares in VLKWM. Therefore, the Merger from various perspectives. Merger will not have an impact on clients, employees, the debtholders and the internal control framework of Attached hereto as Annex A is a simplified schematic VLKWM and its subsidiaries. The only effect of the overview of the group structure of the Van Lanschot Merger which will be perceived by these parties will be Kempen group (the Group) before and after the Merger. In the change of the name of VLKWM from Van Lanschot addition, attached hereto as Annex B are copies of the Kempen Wealth Management NV to Van Lanschot merger proposal (fusievoorstel) that was published on Kempen NV. “Van Lanschot Kempen” is already a trade 15 April 2021 as well as the explanatory memorandum name of VLKWM and this trade name will not change. (de toelichting) in relation to the Merger. All of VLKWM’s other trade names (among which Van Lanschot, Kempen & Co, and Evi) will also remain The Merger will enable the Group to optimise its capital in place. structure. Furthermore, this merger is a next step in the endeavour to further simplify and streamline the corporate • The Merger qualifies as a legal merger (juridische fusie) structure of the Group, building on the legal merger and therefore does not result in, or constitute, an offer between VLKWM (then named Van Lanschot NV) and of securities to the public (the issue of securities will its then subsidiary Kempen & Co NV, which was effected take place as a result of the Merger becoming effective on 1 January 2020. The Merger will also reduce financial following a resolution of the general meeting), and the and regulatory reporting obligations. Merger does not result in a new admission to trading on a regulated market (the depositary receipts that are currently listed will remain listed and outstanding, and 1.2 Executive summary only the shares underlying them will be replaced as a result of the Merger). Furthermore, the current ISIN • The rationale for the Merger, as set out above, is to code of the depositary receipts will remain unchanged. optimise the capital structure. More specifically, the Merger will lead to the following benefits: • If approved by the annual general meeting the Merger is intended to be completed by the end of a) In the current situation VLK Holding must apply a Q2 2021 such that the Merger will be effected as per minority interest deduction in relation to the 1 July 2021. Additional Tier 1 (AT1) and Tier 2 instruments issued at the level of VLKWM, impacting AT1 and • The potential risks relating to the Merger that have Tier 2 capital at the level of VLK Holding. As a result been identified are very limited. If these would of the minority interest deduction, VLK Holding's materialize, the risks can be handled well. See chapter lack of excess AT1 and Tier 2 capital resulting from 5 for a further analysis of the impact of the Merger. the minority interest deduction, also limits the extent to which it can benefit from the recent changes in the Capital Requirements Regulation and Directive (CRR and CRD). The recent regulatory changes in the required composition of the Pillar 2 Merger Addendum 4

2. THE VAN LANSCHOT KEMPEN GROUP AND THE PREPARATIONS FOR THE MERGER

2.1 Introduction • Kempen Asset Management is Van Lanschot Kempen’s specialist asset manager with a sharp focus and a clear In this chapter, we provide information about the Group, its investment philosophy, catering for two core markets. core activities and strategy. We also describe the recent Firstly, Asset Management focuses on a number of efforts in simplifying the legal group structure. asset classes: small caps, property, high-dividend equities, fixed-income securities and funds of hedge funds. Secondly, it offer’s institutional clients a fiduciary 2.2 Business profile and strategy of the service that provides them with a fully comprehensive Group asset management solution based on their own specific needs, including strategic advice, manager selection, Van Lanschot Kempen is the oldest independent financial monitoring and integral risk management. Clients institution in the , and is listed on include institutional investors such as pension funds, Amsterdam. The Group is a well-capitalised, profitable companies, and wealth managers, wealth manager. Our purpose is the preservation and foundations and family offices. Van Lanschot Private creation of wealth, in a sustainable way, for our clients and Banking clients are an important client group for the society we serve. We serve clients in several segments Kempen Asset Management. – private, wholesale & institutional and corporate clients – with a singular mission: to be a trusted partner and assist • Van Lanschot Kempen’s Merchant Banking arm our clients to preserve and create wealth sustainably. We comprises Kempen Corporate Finance and Kempen believe that serving the long-term interests of the clients Securities. Kempen Corporate Finance has leading helps create a platform for responsible investing and positions in its niches (European Real Estate, Life societal stability. Sciences and Financial Institutions & FinTech) and offers specialist services in areas such as securities, We have attained a strong position as an independent and mergers and acquisitions, capital market transactions integrated wealth manager due to our unique combination and debt advisory services. Working within the same of , asset management and merchant niches, Kempen Securities provides analyst research banking services. The core activities of the Group are for listed companies and provides liquidity to combined in three strong brands: Van Lanschot, Kempen institutional investors. and Evi. Since 2013, the Group has been transforming from a small • Van Lanschot private banking aims to help its clients universal to an integrated wealth manager. As per preserve and create wealth at every stage of their lives. year-end 2020 the Corporate Banking loan book is almost Its bankers offer specialist services for entrepreneurs, completed and stood at €195 million. This enables the family businesses, high net-worth individuals, business Group to focus on being an integrated wealth manage- professionals and executives, healthcare professionals, ment house. The low risk exposure in the current loan foundations and associations. Business professionals portfolio has resulted in very limited additions to our loan are partners of accountancy firms, law firms and loss provisions. This has once again proven the robustness consultancies. Executives are members of managing of our wealth management model. Our current capital boards and supervisory boards of listed companies in position remains strong and our CET1 ratio amounts to the Netherlands. 24.3%1.

• Evi van Lanschot is the online investment coach of In order to reap the benefits of scale, and to make use of Van Lanschot Kempen. Evi guides new and the existing successful platform of the Group, VLKWM has experienced investors in the Netherlands and acquired several Dutch competitors: the wealth towards reliable investment and pension solutions. management activities of UBS in the Netherlands, With Evi, Van Lanschot Kempen can offer people with Staalbankiers, a client portfolio from a.s.r. bank, as well as smaller assets for savings and investments a private Hof Hoorneman Bankiers NV. VLK Holding and VLKWM banking experience based on expert knowledge and have intentionally maintained a wide margin in their capital advice. position to be able to pursue further inorganic growth opportunities in addition to organic growth.

1 As per the Annual Report 2020. Merger Addendum 5

2.3 Recent efforts in simplifying the legal group structure

The Group aims to have a simple and transparent legal group structure. Therefore, there has been an ongoing effort in the past few years to identify legal entities within the legal structure of the Group that no longer need to be maintained. This has resulted in the liquidation and dissolution of several legal entities.

In 2018, we started the process of simplifying the core structure of the Group, which resulted in the merger of Kempen & Co NV (licensed investment firm) and Van Lanschot NV (licensed credit institution). This merger was successfully effected as per 1 January 2020. Kempen & Co NV was the disappearing entity, and the statutory name of Van Lanschot NV changed into Van Lanschot Kempen Wealth Management NV (defined in this document as VLKWM). The trade names and businesses of Van Lanschot (i.e. Private Banking and Evi) and Kempen & Co (i.e. Merchant Banking) continued as is.

The initiative to further explore the Merger at hand arose in 2020 and, aside from the desire to further simplify the Group's legal structure, was prompted by (i) the changes in CRDV regarding the composition of P2R and the possibilities to improve the capital position of VLK and (ii) the successful recent mergers of holding companies by ABN AMRO and in 2019.

2.4 Envisaged timeline of the Merger

The Merger is intended to be completed by the end of Q2 2021 such that the Merger will be effected as per 1 July 2021.

Merger Addendum 6

3. ENVISAGED LEGAL GROUP STRUCTURE AND CORPORATE GOVERNANCE

3.1 Introduction The depositary receipts that are currently listed on will remain listed and outstanding, This chapter sets out the Group's current and envisaged and only the shares underlying them will be replaced as a legal group structure and describes the changes with result of the Merger. The current ISIN code of the respect to corporate governance in further detail. depositary receipts will remain in place. The Merger will have no consequences for the indexes in which the depositary receipts are included. 3.2 Consequences of the Merger (juridische fusie) 3.3 Legal group structure before and after The Merger will be a so-called legal merger (juridische the Merger fusie) under Dutch law. This means that as a consequence of the Merger, all assets and liabilities of VLK Holding will In the current situation (please refer to Annex A for a transfer automatically, by operation of law, to VLKWM. schematic overview), VLK Holding is listed on Euronext via Through the Merger, VLK Holding will disappear as a legal the VLK Trust Office. The VLK Trust Office holds entity, and will be fully absorbed by VLKWM. approximately 99.99% of the shares in VLK Holding in exchange for which it has issued depositary receipts which The statutory name of Van Lanschot Kempen Wealth are publicly listed on Euronext. Stichting Preferente Management NV will be amended at the time of the imple- Aandelen C Van Lanschot Kempen (Pref C) is an mentation of the Merger into Van Lanschot Kempen NV. independent foundation that holds an option to acquire “Van Lanschot Kempen” is already a trade name of newly issued preferred C class shares in the capital of VLK VLKWM. Also, all of VLKWM’s other trade names (among Holding. The purpose of Pref C is to safeguard the which Van Lanschot, Kempen & Co, and Evi) will remain in interests of Van Lanschot Kempen and its stakeholders, place. and to avert outside influences that could threaten its continuity, autonomy or identity to the detriment of such As a consequence of the Merger, and with VLK Holding interests. being a holding company without any material or operational activities or contracts in its name, VLKWM will As a consequence of the Merger, VLK Holding will be fully not acquire any significant assets or liabilities. The most absorbed into VLKWM and will disappear as a legal entity. important contracts concluded at the level of VLK Holding Furthermore: are the Group’s main insurance policies. As a consequence of the Merger, these and other contracts will automatically • The current shareholders of VLK Holding, including transfer to VLKWM by operation of law. The Merger will VLK Trust Office, will henceforth hold shares in not have any material implications for clients, suppliers or VLKWM. The depositary receipts will remain holders of debt instruments of the Group, as all of these unchanged and listed on Euronext with the only external relationships are entered into at the level of difference that henceforth they represent VLKWM VLKWM which will be the surviving entity. The only effect shares; and of the Merger for these parties will be the change of the • In accordance with article 2:230 of the Dutch Civil name of VLKWM from Van Lanschot Kempen Wealth Code, the existing option of Pref C. to acquire newly Management NV to Van Lanschot Kempen NV. issued preferred C class shares in the capital of VLK Holding will be replaced by a new option to acquire The Merger will lead to the allocation of shares in VLKWM newly issued preferred C class shares in the capital of to the shareholders of VLK Holding, meaning that the VLK VLKWM, subject to the condition precedent that the Trust Office will be allocated shares in VLKWM in Merger is effected. accordance with an exchange ratio of 1:1. After the Merger, the shares underlying the depositary receipts will VLK Holding currently qualifies as a large company have been 'replaced' by shares in VLKWM and the VLK (structuurvennootschap) and therefore it is obliged by law Trust Office depositary receipts will henceforth represent to apply the large companies regime (structuurregime). the shares in VLKWM that are allocated to it. The VLKWM also fulfils the criteria of the large companies relationship between the depositary receipt-holders and regime, however, as a 100% subsidiary of VLK Holding the VLK Trust Office will not be affected.

Merger Addendum 7

that already mandatorily applies the large companies compared to the current articles of association of VLK regime, VLKWM is exempt. Once the Merger is effected Holding will be certain changes to the absence and the exemption will no longer apply to VLKWM, but inability provisions (belet en ontstentenis) in order to application of the large companies regime will only become reflect recent changes to the Dutch Civil Code. A mandatory under Dutch law after observance of a document showing the changes in the articles of statutory waiting period. Since the Merger is not intended association is attached hereto as Annex C. to result in any substantive changes to the governance of • The board regulations of the management board and the Group, the large companies regime will be applied as supervisory board of VLKWM are already combined per the moment of implementation of the Merger, initially with the board regulations of VLK Holding. After the on a voluntary basis. Three years after the Merger Merger they will be amended to reflect that they only application the large companies regime will become refer to VLKWM. This is a minor technical change. mandatory for VLKWM as well.

3.4 Simplification of corporate governance

VLK Holding and VLKWM have a so-called full personal union, meaning that the composition of their governing bodies (management board and supervisory board) is identical. After the Merger, VLK Holding ceases to exist as a separate legal entity and, this extra layer of boards will then also cease to exist. This will simplify the governance structure. The current members of the governing bodies will retain their current positions as members of the management board and supervisory board of VLKWM with all of their duties and powers.

The administrative burden from having separate board decisions and regulations on both the level of VLK Holding and VLKWM will decrease, although this will only be a limited benefit as, in practice, the additional administrative overhead is not significant. The simplification would make the governance structure more transparent and easier to understand for third parties.

The Merger will not lead to any changes in the composition of the management board of the VLK Trust Office and the VLK Trust Office will continue to fulfil the same role.

3.5 Amendments to articles of association and board regulations

We aim to effect the Merger in such a way that no substantive changes will occur in the way the Group is governed. This means that, in principle, the documents regarding the governance of VLKWM will only be amended and updated in order to fully reflect the current documents regarding the governance of VLK Holding. More specifically this means that:

• The articles of association of VLKWM will, in principle, be fully replaced by the articles of association of VLK Holding. However, given the broader scope of activities carried out by VLKWM as an operational company and licensed credit institution the objects clause in the articles of association of VLKWM will be maintained in the new articles of association of VLKWM. Other than that the only change in the articles of association, Merger Addendum 8

4. BENEFITS OF THE MERGER ON THE CAPITAL POSITION AND REPORTING

4.1 Introduction 4.3 The Merger improves the position with respect to Pillar 1 and Pillar 2 This chapter sets out the most important benefits of the requirements and provides an Merger from a financial structure perspective. The capital opportunity to unlock CET1 capital position of the Group and VLKWM will improve as a result of the minority interest deduction no longer being Another consequence of the minority interest deduction no applicable after completion of the Merger. As a result, part longer being applicable is that available AT1 and Tier 2 of CET1 capital currently utilised to meet Pillar 1 capital can be fully utilised to meet P1R and P2R Requirement (P1R) and Pillar 2 Requirement (P2R) can be requirements partly replacing CET1 capital currently used replaced by AT1 and Tier 2 capital following the changes to meet these capital requirements. Furthermore, the AT1 in the Capital Requirements Directive (CRDV) regarding and Tier 2 P1R of 1.5% and 2.0% respectively can be fully the composition of the P2R. Furthermore, the Merger will met with AT1 and Tier 2 capital instead of partly with lead to administrative efficiency relating to financial and CET1 capital. regulatory reporting, because VLK Holding will cease to exist as a legal entity. 4.4. The Merger lowers administration costs and internal work load 4.2 Merger results in increase of reported Tier 1, total capital and leverage Ratios The disappearance of VLK Holding as a legal entity will because of the absence of the minority reduce the administrative work load in connection with the interest deduction financial and regulatory administration.

In 2017, the EBA published an interpretation of certain capital regulations applicable to European banks. This 4.5 Credit rating will likely not change interpretation prevents the full inclusion by a holding because of the Merger company of instruments issued by a subsidiary at a consolidated level. The EBA interpretation has a VLKWM has its creditworthiness periodically assessed by particularly adverse impact on consolidated capital ratios the rating agencies Standard and Poor's (S&P) and of bank holding companies with a single subsidiary, such FitchRatings (Fitch). The current credit ratings reflect a as VLK Holding. As a result of the interpretation, a portion healthy capital and funding position and a low risk profile. of the 'surplus capital' of AT1 and T2 instruments issued The outlook has been revised as a consequence of by VLKWM can no longer be included in full in the Covid-19 in April 2020. The latest rating report from S&P 'consolidated own funds'. This impacts the consolidated was published in March 2021 and the latest rating report Tier 1 capital, total capital and leverage ratios of the Group from Fitch was published in August 2020:2 and leads to differences in capital ratios on the level of VLK Holding and VLKWM. Credit ratings S&P Fitch After the Merger, the minority interest deduction will no Long-term credit rating BBB+ BBB+ longer be applicable, because VLK Holding ceases to exist Outlook long term Negative outlook Negative outlook and VLKWM will be both the holding company for credit rating regulatory purposes and the bank. This means that Short-term credsit A-2 F2 headline reported capital and capital ratios of the listed rating entity will effectively be the higher ratios currently being Press release (PDF) 24-04-2020 10-07-2020 reported for VLKWM. The level of improvement is a (download) (download) function of the impact of the minority interest deduction, Most recent rating 25-03-2021 06-08-2020 which is a function of surplus capital components being report (PDF) (download) (download) reported at VLKWM level. The Tier 1 capital ratio will Website > S&P > Fitch Ratings increase by 130 bps and the total capital ratio will increase by 293 bps based on the financial results reported per 31 December 2020. It is expected that the credit rating will not change as a consequence of the Merger. 2 vanlanschotkempen.com/nl/creditratings. The reports of S&P and Fitch are also available via this website. Merger Addendum 9

5. IMPACT AND RISK ANALYSIS

VLKWM has conducted an impact analysis for the Merger. Based on that analysis it is concluded that the impact is very limited, because VLK Holding does not have any activities other than holding the shares in VLKWM and VLKWM, the entity which engages in extensive business operations and activities will be the acquiring entity, meaning that its identity will not be affected by the Merger (i.e. it will continue to exist as is).

Impact per stakeholder:

• Business, clients, employees, debt holders: all client contracts regarding private banking, Evi and the merchant banking business, employee contracts and the issuance of the debt instruments are situated at the level of VLKWM and therefore already signed with VLKWM. The clients of Kempen Capital Management NV or other subsidiaries are also not affected by the Merger (although change of control provisions may be triggered). • Internal control framework: the internal control framework is also not affected by the Merger. The current control functions, such as Compliance, Risk Management, Internal Audit and other supporting functions can continue as usual. In practice, VLK Holding and VLKWM are already fully integrated with respect to risk exposure and risk management. The internal documents and policies will be amended in order to reflect the correct description of the legal structure and statutory name.

Although the business, clients, employees and debt holders will not be affected by the Merger, they will be informed about the Merger or will receive amended documents reflecting the new statutory name and legal structure where this is necessary. Merger Addendum 10

ANNEX A

Structure

Before After EURONEXT EURONEXT

Pref C Foundation Pref C Foundation

Listed entity (no "own" Van Lanschot activities) Kempen NV Van Lanschot Kempen NV Banking license, staff, Van Lanschot supplier and customer Kempen Wealth contracts Management NV

Group Companies Group Companies Merger Addendum 11

ANNEX B

Part 1: Merger Proposal

Part 2: Explanatory Notes

[attached seperately] Merger Addendum 12

ANNEX C

Articles of Association compare vs current articles of VLK Holding

[attached seperately]